CFPB Issues Final Rule Implementing Partial HMDA Exemptions and Extension of Temporary Coverage Thresholds

The CFPB recently issued a final HMDA rule, generally effective January 1, 2020, which addresses amendments made by the Economic Growth, Regulatory Relief, and Consumer Protection Act and extends the temporary institutional and transactional coverage thresholds for open-end lines of credit.

The Act, which became law on May 24, 2018, amended HMDA’s data reporting requirements by adding partial exemptions for certain insured depository institutions and insured credit unions.  In August 2018, the CFPB issued an interpretive and procedural rule in which it clarified and implemented the Act’s partial exemptions and indicated that it intended to incorporate the interpretive rule in Regulation C (the regulation implementing HMDA) with a final rule through notice and comment rulemaking.  The CFPB published proposed amendments to Regulation C in May 2019.

The final rule maintained the following three proposals from the May 2019 proposed rule.  First, the final rule extends the current temporary institutional and transactional coverage thresholds of 500 open-end lines of credit for collecting, recording, and reporting data about open-end lines of credit.  This current temporary threshold (established in 2017) was set to expire on January 1, 2020, but the new final rule extends the temporary coverage threshold of 500 open-end lines of credit to January 1, 2022.  Second, the final rule generally incorporates the 2018 interpretive and procedural rule.  Lastly, the final rule further implements the Act’s partial exemptions with clarifications not already addressed in the 2018 interpretive and procedural rule, largely focused on mergers and acquisitions.

The final rule did not incorporate two proposals from the May 2019 proposed rule, namely, the proposal to increase the permanent coverage thresholds for reporting data about open-end lines of credit and closed-end mortgage loans.  Instead of finalizing these proposals, the CFPB extended the comment period on these issues to October 15, 2019, and stated its intention to release a final rule addressing these proposals in 2020 (with the permanent thresholds to be effective on January 1, 2022).

For additional information regarding these changes, see WBK’s articles describing the 2018 interpretive and procedural rule, as well as the 2019 proposed rule, and the extended comment period for the forthcoming 2020 final rule.